View the article online at http://citywire.co.uk/money/article/a511384
British Gas fined £2.5m for complaint handling failures
Energy regulator Ofgem is also investigating Npower and EDF Energy over the way they handle customer complaints.
Energy giant British Gas has been fined £2.5 million for serious failures in the way it deals with customer complaints, Ofgem revealed today.
The energy regulator found British Gas had breached regulations by:
- failing to re-open complaints when the customer indicated the complaint had not been resolved.
- failing to inform customers with details of the redress service provided by the Energy Ombudsman.
- failing to put in place an adequate process for dealing with complaints from small businesses
Sarah Harrison, Ofgem’s senior partner for sustainable development, said: ‘We warned the industry in March that we would be backing up our plans to reform the retail market with a tough approach to enforcement’.
‘This £2.5 million fine against British Gas, and the other £10 million of fines imposed on the energy industry so far this year, sends a clear message to energy companies that they must abide by the rules,’ she added.
Richard Lloyd, executive director at Which?, meanwhile said: 'It’s time energy companies started taking customer complaints seriously, and Ofgem is absolutely right to hand down substantial punishments to those that don’t follow basic procedures.
'Ofgem should now follow the lead of the financial services industry and regularly publish data on complaints, broken down by each company,' he added.
The fine comes less than a month after Ofgem hit British Gas with a £1 million fine for misreporting the amount of electricity it supplied under the government's renewables obligation.
Ofgem is also currently investigating Npower and EDF Energy over complaint handling procedures. Scottish and Southern Energy, EDF Energy, Npower and Scottish Power meanwhile are under investigation for mis-selling, while Scottish Power is also answering questions in relation to potentially misleading marketing and differences between its standard credit and direct debit tariffs.
Shares in British Gas’ parent company Centrica (CNA.L) traded down 3.8p at 322p this morning. The energy giant releases its interim results tomorrow – last year its parent company made a pre-tax profit of £2.8 billion.
Scottish and Southern Energy (SSE.L) meanwhile is today’s biggest faller on the FTSE 100 – dropping 73p to £13.29p.
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